Tullow Oil’s revenues drop by 27%
The Irish oil and gas explorer Tullow Oil has posted a full year loss of $1bn (€886m) for 2015 as revenues in the firm plummeted by 27% off the back of falling oil prices.
However, the firm has narrowed its losses year on year by 37pc, bringing its loss after tax down to $1.037bn, a significant deviation from the $1.64bn loss it filed in 2014.
Tullow Oil also said it was further suspending its dividend payments as the sharp decline in oil prices has drastically reduced its income.
The firm said its revenues had fallen by 27% on 2014, while write-offs and impairment charges also hit its bottom line.
The oil producer said there was a risk, if oil prices remain low, that it may become non-compliant with its financial covenants by the end of the year.
It said it was able to cut annual capital expenditure to as low as $300m in 2017, down from up to $1.1 billion planned for 2016, if market conditions do not improve.
The company’s chief executive Aidan Heavey said that Tullow had “adjusted well” to low oil prices last year.
“We secured current and future cash flow through good operational delivery in West Africa, continued to build our resource base in East Africa, significantly cut costs across the group and benefitted from our strong hedging position,” the CEO stated.
“Our challenge in 2016 is to be equally robust in responding to the uncertainties that remain in the sector, ” he added.
